OPINION: Green Climate Fund takes a significant step forward

Benito Mueller of the European Capacity Building Initiative (ecbi) celebrates progress made at the Green Climate Fund Board meeting last week in Barbados. This post first appeared on the Oxford Climate Policy blog.

There have been occasions when I felt the need to express certain concerns about the direction the Green Climate Fund (GCF) is heading in (e.g. in The Green Climate Fund at the Cross Roads: Bog standard or ground-breaking?). However, at its recent eighth meeting in Bridgetown, Barbados, the GCF Board has taken a significant step in what I firmly believe the right direction by espousing the idea of a Pilot Phase for Enhanced Direct Access.

The importance of this decision lies, in a first instance, in the Board ceasing to merely consider “additional modalities that further enhance direct access, including through funding entities with a view to enhancing country ownership of projects and programmes” (as mandated in paragraph 47 of the GCF Governing Instrument), thus ushering in the operationalisation of Enhanced Direct Access as an access modality of the GCF.

Enhanced Direct Access, in the sense used in this paragraph, refers to the devolution of approval for specific activities to recipient country funding entities, such as the growing number of climate funds established by developing countries as funding instruments for national climate change strategies (by and large quite independently of considerations regarding access to GCF funding).

The idea of Enhanced Direct Access in this sense is by no means new, neither for development nor climate finance. Indeed, the Background Paper by the GCF Secretariat lists three examples that illustrate the considerable variety of ways in which the idea can and has been implemented already:

the Indonesian Kecamatan Development Programme specialized in making block grants for local governments at the district (kecamatan) level conducting a competition for funds among villages and overseeing disbursements,

Quantity Performance-based models such as the Norwegian the Norwegian International Forest Climate Initiative with the Brazilian Amazon Fund and the Guyana REDD+ Investment Fund as funding entities, and

the South African Small Grants Facility designed to directly support to vulnerable groups in defining and implementing effective adaptation strategies and making a direct contribution to climate-resilient development, which was approved by the Adaptation Fund Board just a few days before the Barbados meeting.

However, the decision of the GCF Board to prepare for the launch of an Enhanced Direct Access Pilot Phase by the beginning of 2015 will move the idea centre stage in the global effort to support developing countries in their efforts to combat climate change and its adverse effects at scale. This is why, in years to come, the Barbados meeting may well be judged to have been an historic event.

Ari Huhtala, CDKN’s Deputy Chief Executive, added: “One of the four thematic priorities for CDKN is to ‘increase access by developing countries to financing for climate compatible development action through domestic public and private funding and procedures supported by international climate finance architecture and related services.’ The decision by the GCF on Enhanced Direct Access is an important milestone, and CDKN is committed to supporting developing countries in their journey towards that goal.”

Munjural Khan of The Ministry of Environment and Forests, Bangladesh and spokesperson for the LDC Group in the UNFCCC, commented: “The decision of the Green Climate Fund (GCF) to take an innovative approach termed as Enhanced Direct Access could lay the foundation to enhance access to climate funds by national funding entities of developing countries: this can be marked as milestone progress in policy-making. However, the implementation of a pilot phase of EDA would be instrumental to develop strong country ownership of projects and programmes under the GCF for increasing climate resilience in climate vulnerable countries.”

Editor’s note: At this most recent meeting, Peru and Norway were nominated to become the next Co-Chairs of the Green Climate Fund Board.